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Oracle to pay $199.5 million to settle government case

GSA will receive largest settlement under the False Claims Act

Yesterday the Department of Justice (DOJ) announced that Oracle Corp. will pay more than $199.5 million to settle a lawsuit alleging that the software company made false statements about its sales practices and overcharged the federal government for software and services. 

In May 2007, Oracle employee Paul Frascella filed a whistleblower lawsuit claiming the company didn’t follow through on its promise that it would offer the General Services Administration (GSA) a commercial consumer discount on $1.08 billion in software it purchased between 1998 and 2006.

The DOJ joined Frescella’s lawsuit and also filed its own complaint last year. According to Bloomberg, the agency found that Oracle gave 92 percent discounts to commercial customers and only 25 percent to 40 percent discounts to the government.

The settlement is the largest False Claims Act settlement the GSA has ever received. Frascella will receive $40 million from the suit.

Contributing Author

Ashley Post

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